December 28, 2011

Big Settlement Reached with El Al in Antitrust Case Against Airlines

Four law firms, including D.C.’s Hausfeld, have announced the latest settlement in a massive antitrust case against major airlines that has yielded almost $500 million in settlement awards to date.

The case involves allegations made in 2006 by freight forwarders and companies that ship goods by air, against more than two dozen airlines. The plaintiffs, who are seeking class certification, allege the defendants conspired to unlawfully fix the prices of airfreight shipping services, including cargo shipments made to, from and within the United States. The plaintiffs allege the price fixing took the form of artificially inflated surcharges.

In the most recent settlement, reached earlier this week, the plaintiffs won $15.8 million from El Al Israel Airlines. As part of the settlement, El Al has agreed to cooperate in the ongoing case against the remaining defendants, according to a Hausfeld press release.

“The settlement with El Al is an excellent result for the US class,” said Michael Hausfeld, chairman of the firm, in a statement. “We will continue our efforts to pursue recoveries for the huge number of victims of this cartel both in the U.S. and around the world.”

The El Al settlement was the 16th in the case, which is being handled out of the Eastern District of New York. Other settlements have included $89.5 million with British Airways, and $85 million with Lufthansa. In total, settlements so far have amounted to $478 million.

In addition to Hausfeld, the attorneys at his firm involved in the case are partners Brent Landau, Hilary Scherrer and William Butterfield, and associate Melinda Coolidge. All but Landau work out of the firm’s D.C. office.

In an interview, Landau noted that criminal investigations stemming from the same set of allegations are ongoing, and some guilty pleas have been reached. He said the high number of settlements was a result of the strong plaintiffs’ case. The number of members of the proposed plaintiffs’ class, he said, totals in the thousands.

When asked about legal fees, Landau said hearings haven’t been held yet in many of the settled cases. But in one example, he noted that in the case involving Air France, KLM and Martin Air, attorneys split 25% of the $87 million settlement.